Change Mobile Number

Update Profile

Oil climbs after surprise drop in U.S. crude inventories

LONDON (Reuters) - Oil prices jumped 2 percent on Wednesday after a surprisingly large drop in U.S. crude inventories and as an oil services workers strike in Norway threatened to cut North Sea output.

Brent crude futures were up 90 cents at $46.78 per barrel by 0955 GMT, while West Texas Intermediate (WTI) crude futures climbed 95 cents to $45.00 a barrel.

Oil took its cue from American Petroleum Institute (API) data which showed a 7.5 million barrel drop in U.S. crude inventories to 507.2 million barrels, almost twice the fall expected by analysts.

"Oil's got its own pretty positive drivers at the moment. The API surprise draw overnight is obviously leading to the question of whether we are going to see the same in the official inventory today," CMC Markets strategist Jasper Lawler said.

Official storage data is due to be published by the U.S. Energy Information Administration (EIA) later on Wednesday.

Adding to the upward price momentum was an oil service workers strike in Norway that could impact output from western Europe's biggest crude producing region.

Nevertheless, analysts said any gains could be tempered by caution ahead of the Federal Reserve's Federal Open Market Committee (FOMC) decision on interest rates later in the day.

Economists do not expect a change in rates but any indication from the Fed on the outlook for economic growth could have an impact on the dollar, and in turn, on oil.

"I don't expect the Fed to do anything and I don't expect a 'hawkish hold' either. But a bit of dollar weakness should support the backdrop for oil," CMC's Lawler said.

"Wednesday has become 'Big Wednesday' for oil traders, with not only the FOMC but also the EIA crude inventory numbers out. Should they (EIA) follow the unexpected drawdown like the API and we get no FOMC rate hike, oil bulls may well have reason to be cheering after a tough couple of weeks," Singapore-based brokerage Oanda said.

Key for the market is next week's meeting in Algeria between producers from the Organization of the Petroleum Exporting Countries (OPEC) and Russia to discuss measures to rein in oversupply, including an output freeze at current levels, but analysts said they did not expect significant results.

"Even with a freeze - which would still mean OPEC production is at record levels - we will still be in an oversupplied market," said Matt Stanley, a fuel broker at Freight Investor Services (FIS) in Dubai.

LIVE ADVISORY

TESTIMONIALS

Samiul Shanti

Pro advisory gives excellent stocks and future tips.It is a very good platform for new traders like ... Read More

Samiul Shanti

Pro advisory gives excellent stocks and future tips.It is a very good platform for new traders like me and provides exact entry and exit point.As I am a working professional I can't monitor the market for whole day, so I don't trade regularly.But I made profit in nifty future segment without monitoring the market.Thanks for this unique concept and good effort.
Regards
Samiul Shanti.

Sandeep Paliwal

Dear sir/madam,
This is Sandeep Paliwal from Delhi. I want to thank the team of ADVISORY MANDI that ... Read More

Sandeep Paliwal

Dear sir/madam,
This is Sandeep Paliwal from Delhi. I want to thank the team of ADVISORY MANDI that help me to earn profit in this market. I have started with 25000 and double my money in a month and half. Intraday day tips with stop loss given was beneficial for me.
Thanks

Dev Jadeja

I am very glad to inform that i like this app it's very use full. This app give guideline what to bu... Read More

Dev Jadeja

I am very glad to inform that i like this app it's very use full. This app give guideline what to buy and sell in stock so i earn profit from it .

Chandrakant Adhav

Nandan Mohanty

"Sir,
i have been following PAC since last 1 month. It is quite beneficial for me to conduct... Read More

Nandan Mohanty

"Sir,
i have been following PAC since last 1 month. It is quite beneficial for me to conduct Intraday Treading .The valuable suggestions given by expert advisers without any charge is a pleasant experience for common men.I wish great success for PAC .
Thnak you
Nandan Mohanty
"

Aurobindo Pharma Ltd

Sumeet Bagadia

Commodity Insight: NICKEL/CHANA

Nickel is one of the top foreign exchange earners for Cuba’s stressed economy, and the country...

Sumeet Bagadia

Associate Director

Choice Broking

Techno Buy: EURINR(June)

On daily chart, EURINR has formed Inverted Hammer candlestick near the strong support, which is a bu...

OPINION POLL

Extended Market timing will increase buisness volumes. Do you agree?

Yes

No

Total Votes: 804

Enter email-id to share this news

Important Information

Please fill the required Disclosure/Disclaimer.

Disclaimer

The investment and Trading tips expressed by the participants or advisors (All Advisors or Participants are either SEBI registered Research Analyst or Investment Advisors) on Advisorymandi.com are their own, and not that of the website or its management.....More